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Will the Doha Round Lead to Preference Erosion?

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  • Amiti, Mary
  • Romalis, John

Abstract

This paper assesses the effects of reducing tariffs under the Doha Round on market access for developing countries. It shows that for many developing countries, actual preferential access is less generous than it appears because of low product coverage or complex rules of origin. Thus lowering tariffs under the multilateral system is likely to lead to a net increase in market access for many developing countries, with gains in market access offsetting losses from preference erosion. Furthermore, comparing various tariff-cutting proposals, the research shows that the largest gains in market access are generated by higher tariff cuts in agriculture.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6372.

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Date of creation: Jun 2007
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Handle: RePEc:cpr:ceprdp:6372

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Keywords: developing countries; market access; preference erosion; tariffs; WTO;

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References

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  1. Mary Amiti & Jozef Konings, 2005. "Trade Liberalization, Intermediate Inputs, and Productivity," IMF Working Papers 05/146, International Monetary Fund.
  2. repec:dgr:uvatin:2005073 is not listed on IDEAS
  3. Brenton, Paul & Ikezuki, Takako, 2004. "The initial and potential impact of preferential access to the U.S. market under the African Growth and Opportunity Act," Policy Research Working Paper Series 3262, The World Bank.
  4. Francois, Joseph & Hoekman, Bernard & Manchin, Miriam, 2005. "Preference Erosion and Multilateral Trade Liberalization," CEPR Discussion Papers 5153, C.E.P.R. Discussion Papers.
  5. Francois, Joseph & Martin, Will, 2003. "Formula Approaches for Market Access Negotiations," CEPR Discussion Papers 3720, C.E.P.R. Discussion Papers.
  6. S├ębastien Jean & David Laborde & Will Martin, 2005. "Consequences of Alternative Formulas for Agricultural Tariff Cuts," Working Papers 2005-15, CEPII research center.
  7. Carolyn L. Evans & James Harrigan, 2004. "Tight Clothing: How the MFA Affects Asian Apparel Exports," NBER Working Papers 10250, National Bureau of Economic Research, Inc.
  8. Aaditya Mattoo & Devesh Roy & Arvind Subramanian, 2003. "The Africa Growth and Opportunity Act and its Rules of Origin: Generosity Undermined?," The World Economy, Wiley Blackwell, vol. 26(6), pages 829-851, 06.
  9. Hans P. Lankes & Katerina Alexandraki, 2004. "The Impact of Preference Erosionon Middle-Income Developing Countries," IMF Working Papers 04/169, International Monetary Fund.
  10. Yongzheng Yang, 2005. "Africa in the Doha Round," IMF Policy Discussion Papers 05/8, International Monetary Fund.
  11. Baldwin, R E & Murray, Tracy, 1977. "MFN Tariff Reductions and Developing Country Trade Benefits under the GSP," Economic Journal, Royal Economic Society, vol. 87(345), pages 30-46, March.
  12. Amiti, Mary & Konings, Jozef, 2005. "Trade Liberalization, Intermediate Inputs and Productivity: Evidence from Indonesia," CEPR Discussion Papers 5104, C.E.P.R. Discussion Papers.
  13. John Romalis, 2007. "NAFTA's and CUSFTA's Impact on International Trade," The Review of Economics and Statistics, MIT Press, vol. 89(3), pages 416-435, August.
  14. Kimberly A. Clausing, 2001. "Trade creation and trade diversion in the Canada - United States Free Trade Agreement," Canadian Journal of Economics, Canadian Economics Association, vol. 34(3), pages 677-696, August.
  15. Huiwen Lai & Daniel Trefler, 2002. "The Gains from Trade with Monopolistic Competition: Specification, Estimation, and Mis-Specification," NBER Working Papers 9169, National Bureau of Economic Research, Inc.
  16. Arvind Subramanian & Aaditya Mattoo & Devesh Roy, 2002. "The Africa Growth and Opportunity Act and its Rules of Origin," IMF Working Papers 02/158, International Monetary Fund.
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Citations

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Cited by:
  1. Pedro J. Martinez Edo, 2011. "Reciprocal liberalization: Bilateral, plurilateral or multilateral?," STUDIES IN TRADE AND INVESTMENT, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
  2. Djankov, Simeon & Freund, Caroline & Pham, Cong S., 2006. "Trading on time," Policy Research Working Paper Series 3909, The World Bank.
  3. Persson, Maria, 2011. "From trade preferences to trade facilitation: Taking stock of the issues," Economics Discussion Papers 2011-23, Kiel Institute for the World Economy.
  4. Richard Pomfret & Uwe Kaufmann & Christopher Findlay, 2010. "Are Preferential Tariffs Utilized? Evidence from Australian Imports, 2000-9," School of Economics Working Papers 2010-13, University of Adelaide, School of Economics.
  5. Bernard Hoekman & Will Martin & Carlos A. Primo Braga, 2009. "Trade Preference Erosion : Measurement and Policy Response," World Bank Publications, The World Bank, number 9437, August.
  6. Hamanaka, Shintaro, 2013. "A note on detecting biases in assessing the use of FTAs," Journal of Asian Economics, Elsevier, vol. 29(C), pages 24-32.
  7. Raimondi, Valentina & Scoppola, Margherita & Olper, Alessandro, 2011. "Preference erosion and the developing countries exports to the EU: a dynamic panel gravity approach," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103391, Agricultural and Applied Economics Association.
  8. Olga Pindyuk & Leon Podkaminer & Sandor Richter, 2008. "Monthly Report No. 1/2008," wiiw Monthly Reports 2008-01, The Vienna Institute for International Economic Studies, wiiw.
  9. John Romalis, 2007. "Market Access, Openness and Growth," NBER Working Papers 13048, National Bureau of Economic Research, Inc.
  10. Persson, Maria, 2013. "Trade Preferences from a Policy Perspective," Working Papers 2013:3, Lund University, Department of Economics.
  11. Erika Vianna Grossrieder, 2006. "Preference Erosion: The case of Bangladesh - A SUR-EC-AR Gravity Model of Trade," IHEID Working Papers 18-2007, Economics Section, The Graduate Institute of International Studies, revised Aug 2007.

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